June 2016 marked the second annual Annuity Awareness Month, an event designed to increase consumer knowledge of the benefits of annuities. Different organizations bonded together to form The Coalition for Annuity Awareness that manages the event, including Beacon Research, the Society of Financial Service Professionals (FSP), the National Association for Fixed Annuities (NAFA), the National Association of Professional Agents (NAPA), the Society for Fixed Annuity Facts & Education Inc. (SAFE) and Wink Inc. Throughout June, these organizations offered educational materials and webinars to educate financial professionals and consumers on the role annuities can play in a secure retirement plan.
According to the coalition, there is currently more than $500 billion of in-force premium serving roughly 3.3 million Americans. The annuity market is largely composed of middle-class consumers with an average annuity valued at $90,000 and a household income of approximately $100,000. In addition, more than 75 million Americans now rely on annuities and other insurance products for financial and retirement security, with nearly 20 percent of Americans’ long-term savings in life insurance and annuities.
“As today’s challenging economic environment continues to evolve, a growing number of individuals and families are turning to annuities to help provide security for their retirement,” according to the coalition. “Specifically, many consumers are using annuities as a vital risk management tool to protect themselves against the possibility of outliving their financial resources. Annuities are unique among financial products in the marketplace because they can provide retirees with a guaranteed lifetime income stream.”
Annuity sales have been growing steadily, and financial professionals and consumers are increasingly aware of the value of annuities in a retirement portfolio. Wink’s Sales & Market Report reports that fixed indexed annuity sales reached a new high in the first quarter of 2016 — $15 billion — up nearly 33 percent compared with the first quarter of 2015.